This is a journal that's intended to be like the "Charts" thread by ZZZzzzzzzz, but instead, focus primarily on breakouts that work, or fail, and the possible reasons as to WHY they worked or failed. cm69
Breakouts are my primary focus. I am not concerned with why they fail as it seems to me there can only be one reason, the sellers overcome the buyers or vice versa. What I am interested in is how to determine when it is failing as quick as possible. The only thing I know to do is watch the dom. If it doesnt take off almost immediately I am out. This leads to small losses but you will make up for them when you catch the good one. The next problem is exits. It seems to me that you need to go for the big moves so some sort of trailing stop seems best to me at this time. This is my take on things so far. Hope we can get some input from the xperts.
SHW this one is interesting. The intermediate break failed, but it seems to have rested on the long term trend.
UTHR I'd consider this a moderat risk trade because two of my indicators (MFI, Volume) gives a positive reading. ROC was negative at the time of the breakout, and it was also below both MA's... After the pullback, there was a NICE gap, but there was nothing to suggest that the stock would've done so before hand..or was there?.
CM, Hey, how you doin? I hope this will help explain why some of these are failing. I think you might be classifying the breakout too early. It is a common mistake to say it has broken out of a pattern as soon as the candle crosses our lines that we draw. The real breakout is after it breaks out of the top of a flag pole in this case. Hope this will help shed some light http://thepatternsite.com/htf.html